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Commonly asked questions about instant personal loan
With digital advancement, the financial sector in India has witnessed a major change that has made it possible for citizens to get quick access to money.
Today, one can easily avail a loan from the comfort of his home without having to visit a bank or lender’s office. Fintech companies in India have now made it easy for loan seekers to get loan almost instantly without having to wait for a day even.
The popularity of Instant loans has been on a rise owing to its easy availability and hassle-free online application process.
However, when availing this type of loan, you must read on the below commonly asked questions that will help you understand this loan product in detail.
What is an instant loan?
Just like a personal loan, an instant loan is an unsecured loan that does not require you to keep any collateral or guarantor.
This type of loan can be used to meet any type of emergency financial requirements including wedding expenses, debt consolidation, purchasing assets, traveling or even paying off the hospital bills. T
his type of loan involves minimal documentation process and is often disbursed instantly unlike other types of loan that are disbursed within 3-4 days. This type of loan can be obtained from any online money lenders in India or any banking institute.
Is Credit score important when applying for an instant loan?
A credit score is one of the most important eligibility criteria that helps lenders assess your creditworthiness.
The score ranges from 300 to 900 and any score above 700 is considered to be an ideal score for availing an instant personal loan.
Having a low credit score is a sign of bad credit behavior and also signifies a bad repayment history. A low credit score leads to loan rejection, whereas a high credit score helps you get an instant loan at a low-interest rate.
The score is checked by all the lenders in India and the loan amount and the interest rate offered is also decided based on the score.
What is the eligibility criteria to avail an instant loan in India?
For your instant loan application to be approved, you must fulfill the below eligibility requirements.
- You should be aged between 21-60 years
- You should be a salaried employee working as a public, private or government employee
- You should be a citizen of India
- You should be having a monthly income of Rs. 20,000
To be eligible to get an instant loan at an affordable interest rate, it is significant you have a good credit score.
Usually, lenders prefer offering loans to individuals with a credit score of 700 and above
What are the documents required to get an instant loan in India?
Below are the documents you have to submit to avail an instant loan
- Any one identity proof such as PAN Card, Aadhar Card, Driving License or Passport
- Any one address proof such as Passport, Aadhar Card, utility bill like water bill, electricity bill or phone bill
- 2 photocopies
- Last 3 months salary slip
- Last 3 months bank statement
How to apply for an instant loan?
There are various ways by which you can apply for an instant loan. You can either visit the lender’s office or can apply online through the lender’s app or website.
Some lenders also allow you to check your personal loan eligibility online before making a loan application.
When applying online, you can submit your personal as well as professional details online and can upload scanned copies of the documents too. Once your application is approved, the loan amount is disbursed immediately in your bank account.
How is instant loan EMI calculated?
The EMI of an instant loan is calculated based on loan tenure, loan amount and rate of interest offered by the lender. You can use the loan EMI calculator tool to get an estimate of the EMI you will have to pay towards the instant personal loan you opt for.
What are the benefits of availing an instant loan?
- Instant disbursal: On successful loan approval, the loan amount is disbursed in your bank account immediately.
- Flexible tenures: These loans are generally offered for a tenure of 6 months-36 months. However, this may vary from lender to lender.
- No collateral required: This is a type of unsecured loan that does not require you to keep any asset as collateral or keep any guarantor either.
- Less processing time:The processing time for an instant loan is lesser than the processing time for another type of unsecured loans.
- Affordable interest rates: Lenders usually charge an affordable interest on this type of loan depending on your credit score.
What is the processing fee for an instant loan?
The processing fee for an instant loan is 2%-4% of the loan amount. However, this varies from lender to lender.